‘Connectivity deficit’ costs UK economy £30bn a year

Report claims that deficiencies in broadband and remote working leads to ‘long-term inefficiencies’

by Ryan Platt

Updated: Feb 17, 2014 Published: Feb 17, 2014

The UK economy is missing out on £30bn of growth per year due to a ‘connectivity deficit’ in UK businesses and public sector organisations, according to a new report.

A poll of British businesses released by the Centre for Economic and Business Research (Cebr) in conjunction with O2 claimed that despite advances in broadband, mobile and remote working technology, many businesses are failing to utilise these effectively – leading to long-term inefficiencies in how business is conducted.

The study found that despite improving employment rates, productivity in UK businesses has been declining since the onset of the recession, with the average output per hour worked almost 5% lower in the fourth quarter of 2013 compared to pre-2007/8.

O2 said UK companies could significantly boost their productivity by investing in more effective connectivity for their employees, by taking measures including improving remote working technology and investing in connectivity for external meetings.

However, it claimed the ‘risk averse’ culture of Britain’s medium-sized and larger companies could represent a barrier to adoption of essential technology, with one in four respondents citing issues around trust, responsibility and readiness for change as barriers to adoption.

Ben Dowd, O2 business director, commented: “Too many businesses pay lip service to technology. But the reality is that our businesses and public sector organisations are yet to get the best that technology has to bring.

“Every employer should try to understand their own connectivity deficit. Even small improvements will help businesses grow and in turn provide more jobs and increased wages, as well as improve the lives for their hard-working employees.”

Responding to the report, Ed Vaizey, UK minister for Culture, Communications and Creative Industries, said: “Government is transforming broadband across the UK and is on track to deliver superfast broadband coverage to 95% of the country by 2017.

“This investment in connectivity across the country is providing opportunities for a more flexible and efficient business environment which this report highlights. A better connected Britain is essential for driving growth and boosting local economies, ultimately helping us to win in the global race.”